A new quarterly index of private rental sector (PRS) rents was published this week. As there was currently no official published index of PRS rents, the Office of the Deputy Prime Minister has created a quarterly index for England using the data collected by the Survey of English Housing.

Given that it is government policy to encourage the development of the PRS, interest in trends in private rents is likely to increase. It is therefore sensible to try and fill this gap using the quarterly data collected by the Survey of English Housing (SEH).

The SHS is a continuous household survey, carried out for the ODPM by the National Centre for Social Research, which provides key housing data for all forms of tenure (i.e. owner occupation and the social and private rented sectors) in England.

The index is published on an experimental basis as the methodology is still under development. Initially the index is based solely on the SHE, a continuous household survey carried out for the ODPM with a sample size of approximately 20,000 households per annum, but only around 2,000 of these are in the PRS.

The survey design gives a nationally representative sample of private households in each quarter of the year.

The ODPM index uses data from the SEH on weekly rents before housing benefit and excluding Council Tax and water and sewerage charges, in cases where these charges are paid as part of the rent.

As expected, rent levels vary by region. In 2002/3 the mean rent levels in London and the South East were 70 per cent and 19 per cent higher respectively than the national average. In all other regions mean rent levels were 20 to 42 per cent lower than the national average.

For England as a whole, the mean rent for a flat is higher than the mean rent for a house with the same number of bedrooms. The latter is almost certainly a result of a greater concentration of flats in London and the South East where rent levels are significantly higher. Not surprisingly for a given property type the mean rent increases with the number of bedrooms.

The full report can be viewed in .pdf form at www.odpm.gov.uk/pns//pnattach/20040100/1.pdf

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